Skip to main content

tv   Power Lunch  CNBC  November 21, 2012 1:00pm-2:00pm EST

1:00 pm
>> quanta services. >> have a great thanksgiving. "power lunch" begins now. we're going to begin this hour with breaking news. more on the headlines that crossed within the hour. in one hour's time a cease-fire will take effect in israel. israel and hamas have agreed to stop the shooting, end days of rocket attacks and bloodshed. it is officially set now to go into effect at 9:00 p.m. local time, 2:00 p.m. eastern time here in the u.s. the deal announced by the egyptian leader, mohamed morsi, and secretary of state hillary clinton. it was later confirmed by israeli president benjamin netanyahu. comes just hours after a bomb blew up on a bus in the heart of tel aviv. dozens were injured. so far no claim of responsibility but hamas called it a blessed event. within the last few hours,
1:01 pm
israeli air strikes continued in gaza. this is video of secondary explosions when an hamas weapons depot was hit. michelle caruso-cabrera, our chief foreign correspondent is watching reaction at the nyse. michelle? >> that pushed the dow to the highs of the session. the announcement of the cease-fire got us another 25 points. we have come off the highs, 12,839 is where the dow stands right now, higher by more than 50 points, .4%. president obama reportedly just spoke with israel's prime minister benjamin netanyahu. john harwood joins us now. john, what can you tell us? the white house had a lot at stake here by sending hillary clinton to try to get this resolved. >> reporter: absolutely. and this is the result that president obama had in mind when he sent hillary clinton from that asian trip that he was on to try to broker a cease-fire. but it's only a cease-fire. it is only one step. there is a long way to go. the administration of course is caught between support for our traditional ally israel, but also the desire for -- by the administration to improve its ties throughout the arab world
1:02 pm
and the islamic world and this has been a very difficult situation. the president hasn't been all that engaged after an early attempt early in his administration to broker a middle east peace deal. now he's back in it with both feet and we'll see the prospects for getting it done. this has frustrated american presidents offense a very long period of time but you simply -- the administration did not want to risk the geopolitical and potential economic fallout from a ground war in gaza that would have the potential to destabilize the entire region. >> absolutely. it is so interesting to watch the new egypt emerge here and see what their role will be throughout this and in the future. thank you, john. let's look at where the markets stand right now. it is a good checkpoint here at about two minutes past 1:00 eastern time. industrials up 48 points at 12,835 and change. nasdaq higher by .5%, 2,924. s&p up 2 1/2 points at 1
1:03 pm
$1,390.32. gold at $1,731 an ounce. oil moving a little bit higher. the january contract at $86.97, up 22 cents. brent crude at $109.93. michelle? another international note on a store out of europe that we continue to watch as well. there are reports of a deal to release emergency aid to greece could come monday. we're also learning today the european central bank is satisfied with a plan to recapitalize greek banks. that's going to be a key part of any kind of international bailout to get that country back up on its feet. now to shopping an retail. of course it takes center stage this week. before we get to what retailers are hoping for, fearful of, and promising for this crucial holiday shopping season, let's look at the shopper. steve leisman on some fascinating numbers on the health of the consumer heading into this critical time of year. steve? >> tyler, thanks very much.
1:04 pm
we are going to check the pulse of the consumer heading into this holiday season. the retailers can only do as well as the shopper is doing in their wallet, in their pocketbook and in their mind. here we have -- we have these nice lines here. that's supposed ton like d to ekg. we're checking the holiday health of the consumer. one of the key metrics for what consumers think about the world -- home prices. this time last year, median home price fell at almost a 6% rate. now it's rising by 11%. let's move on and take a look at wages. wages were up 3.5%. year on year this time last year. now the number is almost 4%. still needs to be 5% or 6% because that's a nominal number that doesn't account for inflation. sentiment 20 points high weather it comes to the consumer. what about the unemployment rate? this time last year we went into christmas with a 9% unemployment rate. now move it over. it is 7.9%.
1:05 pm
still too high but quite a bit better than it was. what about debt? a key aspect for how consumers feel and their ability to shop. you can see here, over the period of the crisis, debt levels have come down and the debt service levels have come down because interest rates have come down. we had -- if you just zoom in right here on that green line, a slight blip up in total household debt in the last quarter. that could have been a little more confidence to borrow, it could have been a little more distress. but the consumer is not out of the woods. from are plenty of uncertainty. we've seen almost no effect at all on consumer sentiment. we know it will weigh in their pocketbooks if those spending cuts take place. what about in sentiment? how secure do consumers feel in their job and income? a very key factor -- what is the right savings rate, how comfortable do consumers feel with how much they have in their bank and what's the right debt level, do they still feel the need to bring debt levels down.
1:06 pm
not bad shape but a lot of uncertainty whether it comes to the mind of the consumer heading into the holiday season. >> but consumers feeling a little bit better. we're going to talk more about retail in a couple of minutes. michelle has more on our top story, the cease-fire deal brokered in the middle east. >> joining us on the phone right now, nbc news correspondent richard engel joining us on the phone from gaza. what's the latest, richard? >> reporter: according to the israeli government and according to egypt, a cease-fire has been reached. what's interesting is a statement that comes from israel that says prime minister netanyahu a short while ago spoke with president barack obama and agreed to his recommendation to give the egypti egyptians a chance to stabilize the situation and calm it down. the israeli prime minister says, yes, in doing it, we are giving it a chance and that he accepted this by president obama's recommendation. so, yes, they're agreeing to it
1:07 pm
but doesn't sound like a great degree of confidence coming from the israelis. >> this doesn't sound like it takes invasion off the table? >> it does take invasion off the table for now. they said we are going to agree to this, that all parties, according to this deal brokered by egypt, are accepting it. but it sounds like the israelis are still in a wait-and-see mode and are saying, yes, we have accepted this cease-fire but it was the president of the united states who asked us to do it, therefore we will give it a chance. >> so he's wrapping it around the president's neck -- >> exactly. >> okay. thank you, richard, i know you're very busy in gaza. nbc news correspondent richard engel joining us on the phone live from gaza. the nation's largest retailer opening tomorrow night to try and get the early shoppers and that is oechg uppe a sizable labor dispute. worker walkouts and protests are planned for some stores. the national labor relations board now involved.
1:08 pm
hampton pearson is following the story. >> hello, tyler. well, it could get a little noisy outside your local walmart on black friday. the national labor relations board says it is unlikely it will act on a complaint filed by the retail giant in time to head off nationwide protests on black friday. a statement from the office of the nlrb general counsel says, in part -- legal issues, including questions about what constitutes picketing and whether the activity was aimed at gaining recognition for the union are complex. now walmart claims the united food and commercial workers international union has backed job actions and protests in recent months aimed at disrupting walmart's business and unionizing employees. walmart officials tell cnbc it was important to get their complaint on the record even if it could not be resolved before black friday. what happens next is up to the nlrp general counsel, lafe solomon. he operates independently of the five-member board. that board has been under fire from business groups for
1:09 pm
overreaching its authority. there are legal challenges to two of its members over recess appointments made by president obama last january. as for black friday, shoppers, there's 35 million of them that showed up nationwide at walmart stores last year, the complaint says it's not changing anything due to those planned protests. that's walmart, that is not changing any of its business practices heading forward. michelle? >> got it, hampton. thank you. another disruption this holiday shopping season -- cheap, mobile and free. video industry's worst nightmare like the grinch stealing profits. julia boorstin is live in l.a. with more. >> there is an industry wide decline in retail sales of video games. question is how to grow profits from mobile games which are free or cost just 1 or $2 without cannibalizing sales of $60 packaged games. electronic arts is responding by slashing new console and pc games from 67 in 2009 to just 22
1:10 pm
new releases this year. next year ea will release just 14 package titles, doubling down on digital with more than 30 mobile and social games adding to its already 500 mobile titles. ea says the price options, either free or low cost with paid extras, aims to capture the billion-plus potential gamers with smartphones. >> mobile games are as profitable as console games. the costs are actually less and the revenue can be as much, if not greater than a console product. >> reporter: ea's mobile revenue grew 60% to nearly $90 million last quarter driven by a 120% increase from tablets and smartphones. now many of ea's mobile hits are based on popular console titles like madden, the simpsons and fifa, protecting traditional games while keeping players
1:11 pm
hooked. ea expects to see a surge in mobile gaming revenue this holiday season as gamers unwrap new devices and also cash in their gift cards. so with just 33 days until christmas, every minute counts for shoppers trying to get it all done, sensing an opportunity, retailers now of course competing to get you in and out of the store as quickly as they can if that's what you need. courtney reagan here now with her stopwatch putting those in-store pick-up promises to the test. >> this year sears is making the five-minute pick-up promise. if you make a purchase online and drive to the store they'll have the item loaded in your car with a surprisingly short five-minute window. even on black friday. really? we put sears, best buy and walmart stores pickup to a race against the clock. of course ourunder cover cameras were rolling. our experiment starts online. at three major retailers. the purchase, an nintendo hand-held game console.
1:12 pm
first round, the clock starts the moment we click buy and stops when the console is ready for pickup. walmart sends us a ready for pick-up e-mail in 41 minutes. sears shoots us an e-mail for pick-up in just eight minutes. we never got an e-mail from best buy but when we checked the order status ourselves -- it said ready. that was 1:15 minutes later. clear winner in round one -- sears. now for round two, the actual store pick-up. the clock starts when we hanover the receipt and stops when we've got the console in hand. sears claims it can get you in and out fast promoting the five-minute promise. let's see if they can do it. at the jersey city location, there's a key yociosk inside to the confirmation e-mail. promise achieved -- 1:44 seconds later. next walmart in new jersey. no time promises here. our producer presents the receipt and gets the console in 2:05 seconds. now best buy. no guarantees on wait time here
1:13 pm
either but after the receipt is taken, we have console in hand in just 1:58 seconds. >> have a great day. enjoy. >> sears wins again. of course there is a human element involved in this. we did this before black friday so this could shift a bit depending on region or even store location but so far retailers are delivering on their promises. >> pretty nice, courtney. sears, the big winner there. the quick turnaround at those stores may be the only thing that's moving quickly on this wednesday, this getaway weekend. planes, trains, automobiles, no matter how you want to get there this thanksgiving, phil lebeau has it covered and he joins us from o'hare. phil? >> reporter: you know, tyler, this may be the smoothest start to any thanksgiving travel weekend that i can remember covering as a reporter. look at the security line back here at terminal 3 at o'hare. there's nobody there. i know it is the midday lull but there are still a number of flights out there around the
1:14 pm
country. fact 5,000 flights are in the air right now. as you look at this map you can see that there's no weather systems out there. maybe a little bit of rain out in the seattle area but generally speaking that's why we're not seeing major delays around the country. certainly good news for the airlines. these people who are flying right now are just a fraction of the 43.6 million who will be traveling this weekend. that's a slight increase from last year. they are, however, spending about 10% less this year in terms of how much they are spending on their trips. but for the airlines, because this is a huge weekend for driving profits, the good news is that it is off to a smooth start. >> the good news is that as things are going right now on the busiest day of thanksgiving weekend, it is going pretty smooth. we're not expecting any major storm systems coming through other than in the pacific northwest. i think we're going to have a good weekend. >> it's huge for the airlines to have a good weekend. for the first half of this year, we talked about how they've been stripping out capacity, raising
1:15 pm
fares. they've raked in more than $2.5 billion first half of the year. average fare in the second quarter was up to $385. importantly for the airlines, they expect to have higher fares -- not a huge increase, but higher fares during christmas. as you take a look at the airline index, this is an index that still trades predominantly based on what happens with jet fuel prices. as they've moderated, the airline stocks have moved high person that's the story here at o'hare. guys, back to you. >> phil, happy thanksgiving. new information on one of the biggest insider trading probes ever. that's coming up. if congress fails to come to an agreement on the fiscal cliff, the head start grant program will see its funding cut by over $620 million affecting almost 100,000 low-income children and over 20,000 jobs. ♪
1:16 pm
[ male announcer ] 'tis the season to discover the kid in all of us. enjoy free shipping and great values on your holiday shopping from l.l. bean. you can stay in and like something... or you can get out there and actually like something. the lexus december to remember sales event is on. this is the pursuit of perfection. well, having a ton of locations doesn't hurt. and my daughter loves the santa. oh, ah sir. that is a customer. let's not tell mom. [ male announcer ] break from the holiday stress. fedex office.
1:17 pm
[ male announcer ] break from the holiday stress. thrget 3 yearsgiving weekend, interest-free financing and save up to $600 on beautyrest and posturepedic. even get 3 years interest-free financing on serta icomfort and tempur-pedic. mattress price wars ends sunday at sleep train.
1:18 pm
my colleague sue herera recently spoke to some icons of the fashion and retail world while attending martha stewart's american-made conference in new york city. to find out where they stand on the fiscal cliff and the economy. here's what they told her. >> everyone is concerned all around the world. i think it's going to take -- and i'm not an economist, but listening to what everyone says,
1:19 pm
people i have great respect for -- it's going to take time and so much depends on what happens in europe and in asia and it's not just what happens in the u.s. but i still think that shouldn't discourage people from wanting to succeed and i think they have to be confident that you can do well even in tough times. >> i think we're always a bit scared about where the economy is globally and i think i'm not different from that. we just hope that it gets back on the right track and hopefully that's where it's going. >> i think it really causes the entrepreneurial spirit to thrive because people are no longer looking at the old mechanisms and the old ways that people are worried about wall street so they're not looking at wall street as a road. when they're thinking about finance, they're thinking about it in other ways. when they're thinking about
1:20 pm
retail, they're thinking about it in new and different ways. in this generation of millennials is fearless and they believe in creativity. they are absolutely fearless. they know no no. >> rick caruso is behind some of the biggest retail and entertainment centers in the country, including the grove in l.a. he's there right now. mr. caruso, welcome. good to have you back with us. how is business looking to you right now? >> business is looking strong. we've surveyed the stores' managers, talked to the general managers on our properties and we've got a lot of confidence that the consumer has a lot of confidence. our sales are up significantly. traffic is up double digits. we're very pleased. >> that's the retail front. how about the real estate front? what are you sensing there? >> you know, on the real estate front, i tell you, i think we've got a very heated market and a
1:21 pm
good market. certainly if you're in the business of selling real estate, i think it is getting much stronger. if you're in the home business, there's a lot of strength behind it. lower interest rates are helping affordability. there's a higher demand. i think confidence is up which is good and i think the higher confidence is going to prove to help the economy into the first quarter. >> mr. caruso, it is michelle caruso-cabrera here. don't think we're related. we can tell all that to anybody in the audience who's wondering. the fiscal cliff, your concerns about it. you convince it is going to get happened? what if it doesn't? what does it mean for your business? >> you know, michelle, i'm convinced that it is going to get solved for the following reason -- the downside is so great that our leaders need to solve the problem and they are aware they need to solve the problem. the fiscal cliff is all about uncertainty. uncertainty is bad for everybody. it's bad for the investor. it is bad for the consumer. it is bad for the retailer. i think our elected officials
1:22 pm
understand that. i think the president understands it. and fortunately, i guess in an odd way the downside is so great they have to come up with a solution? >> how about if they don't? how would it be for your business? >> i think it is going to have an impact on the business only due to uncertainty. but i think there is a lot of positive influences in the consumers' minds right now. the fact that affordability is better. the fact that they feel better about their jobs. the fact this they see job growth happening. certainly here in california we've had job growth. so i think in our world in southern california we're going to be in pretty good shape. but uncertainty is never good. i don't think there should be an option. >> mr. caruso, yesterday craig barrett, former ceo of intel, described california where you live and do a lot of business as america's version of greece because of the level of public expenditure and so forth. do you see it that way? >> no, i don't see it that way. listen, california has its issues. locally we have our issues.
1:23 pm
there are income issues, there are increased taxes that i wouldn't necessarily want to have happen in the state, which did happen. but we have to address those. i think we've got positive momentum. i know we have positive momentum. so are we perfect? no. but california is growing at a much faster pace and a better pace than most of the united states. so i don't equate it to greece at all. >> mr. caruso, thank you for being with us and a happy thanksgiving to you. >> thanks you. he's a billionaire, right? i wish he were related. all right, next, making cardboard profitable and interesting. jane wells is on the case, of course. jane. >> hey, michelle. say you have a business where you use a lot of cardboard boxes and you want to be green and buy cheaper recycled boxes. we. fou we found a guy that will sell them to you and sometimes they are the original boxes you got rid of in the first place. it's genius! if lawmakers do not act to
1:24 pm
save the economy from falling off the fiscal cliff, $490 million would be cut from the centers for disease control and prevention's national breast and cervical cancer early detection program, which would result in over 33,000 fewer women screened for breast and sercervical canc. it's about who lives in the yellow house, the green, and the apartment house, too. today we not only honor the oval office, but we honor the cubicle, and the home office as well. because today it's about all of us. and no matter who you are, you're the commander-in-chief of your own life. ♪
1:25 pm
sven gets great rewards for his small business! how does this thing work? oh, i like it! [ garth ] sven's small business earns 2% cash back on every purchase, every day! woo-hoo!!! so that's ten security gators, right? put them on my spark card! why settle for less? testing hot tar... great businesses deserve great rewards! [ male announcer ] the spark business card from capital one. choose unlimited rewards with 2% cash back or double miles on every purchase, every day! what's in your wallet? here's your invoice.
1:26 pm
i am sure you've wondered
1:27 pm
what happens to a cardboard box once those flaps fulfill their destiny? who else but jane wells found a company that's redefining recycling in the cardboard business. jane. >> michelle, this is the season are lots of cardboard boxes. a lot of recyclers are in the business. as big box retailers look to green up their practices, one company is making a lot of green doing it for them. this is what happens when most cardboard boxes are recycled. they're shipped as scrap overseas to be reformed. but one guy has cornered a unique part of the market. >> i want to do something different. >> reporter: marty metro started used cardboard boxes, ucb for short. bulk of his business is taking boxes suppliers use to ship goods to big retailers like walmart, rehabbing those boxes and selling them back to the same suppliers. >> we go out and we buy boxes but we don't buy scrap. we buy reusable good quality
1:28 pm
cardboard boxes that big companies are unpacking. >> why doesn't walmart do it on its own? why does it need you to do this for them? that's a great question. >> reporter: he says the answer companies like walmart are not in that business. he's convinced them to hire ucb as a middleman. >> we have three locations we own. we have seven different locations we ship from. >> reporter: ucb pays walmart more for the boxes than others pay and sells them back to suppliers for less than new boxes cost. metro's turned it into a multi-million dollar business that has saved trees and helped retailers look green. chase has rewarded the firm with a $250,000 grant. >> i didn't set out to create a green company. i didn't set out to be a "kumbaya," savt whales pers"," person. i wanted to do something that, a, made an impact on this world potentially positive, and, b, i wanted to be able to sleep at night. >> the boxes can be reused about three times on average.
1:29 pm
ucb says based on an industry formula they've saved the equivalent of over 340,000 trees. very cool. gold prices closing right now. >> gold prices have been inching higher. we talked $1,730 an ounce. traders on the floor are still trying to weigh reports of the cease-fire between israel and hamas and what that means for the metals market. we are also looking at technical levels that it looks like gold is approaching the 50-day moving average being one ever them. silver's also on a tear today, silver at a one-month high, gaining sharply. but copper, a far different story. copper is weaker here. still waiting to see what happens in the eurozone in terms of a deal on the greek bailout plan. then keep a look at the metals market in general. mixed picture here with palladium leading the way. it's also at a one-month high. traders here on the floor are going to get a break tomorrow. there's no floor trading but only a short break for electronic trading. it will be a halt for about five
1:30 pm
hours tomorrow afternoon but then business as usual on friday. back to you. >> thank you, sharon. who's the man behind sac capital advisor steemor steven ? we'll get an inside look. and a different side of the housing market. we'll take to you one of of the most beautiful cities in the country to show you some of its most beautiful homes. but wait until you see who's buying them. back in two. [ male announcer ] this december, remember --
1:31 pm
you can stay in and share something... ♪ ♪ ...or you can get out there with your friends and actually share something. ♪ the lexus december to remember sales event is on, offering some of our best values of the year. this is the pursuit of perfection. offering some of our best values of the year. customer erin swenson bought so, i'm happy. today. sales go up... i'm happy. it went out today... i'm happy. what if she's not home? (together) she won't be happy. use ups! she can get a text alert, reroute... even reschedule her package. it's ups my choice. are you happy? i'm happy. i'm happy. i'm happy. i'm happy. i'm happy. happy. happy. happy. happy. (together) happy. i love logistics.
1:32 pm
1:33 pm
bob pisani joins us here on the floor. the do you industrials higher by 47 points. nasdaq higher by nearly eight points. if we were going to show you an intraday, you'd see the market moved to the highs of the session when we learned within the last half-hour or so that there was a cease-fire between hamas and israel about to go into effect at the top of the hour. >> and we did. we saw oil move just a little bit. we did see the markets move to the highs today, just about 50
1:34 pm
points. 3. 2 advan -- 3-2 advancing to declining stocks. markets are giving congress a pass on the fiscal cliff. home builders, gold stocks big gainers this week. defensive names, cyclical stocks are the biggest gainers on the week. dow is up 2%. we also see s&p 500 sector gainers. this is all the risk-on trade. materials, tech, energy, financials, there's your classic risk-on move and for the week the dow is up 2%. s&p up maybe 2.3% for the week. my sense is that this is going to last another week and a half to two weeks. you have a grace period where they'll let them negotiate. if we get into the week of december 10th, everyone feels we better get some outlines of what will happen. if there's not the obvious -- we're not going to have a deal, it is going to move down very fast. i think we have a period of a week and a half here. >> we'll be watching. thank you. the announcement of the
1:35 pm
cease-fire. did that lead to selling in treasuries? rick santelli is tracking the selling at the s&p. >> definite talk on the floor has been almost universally about the cease-fire and a lot of thought as to why the market and treasuries didn't really respond much. you could look for yourself. intraday. we did get some movement but it was much earlier. if you look at the s&ps, you can see that it is a different form entirely and definitely more responsive to those headlines. let's put them both on the same chart. you could really see a lot of traders behind me that for the most of the last week and a half have been trading the fixed income based on the small movement like the two-minute chart of the dow jones industrial average and s&p. not working very well today.
1:36 pm
maybe the most watched chart on this trading floor and most profitable, look at this chart going back to april of the dollar/yen. this trade continues to have a boat load of movement. today is no exception. many traders say if you come in friday, and many of them are, this is the trade they're going to be paying most attention to. tyler, back to you. >> rick santelli, thanks very much. you pick up a major newspaper today, you will almost surely see his name, steve cohen, the head of sac capital advisors. "wall street journal" and "financial times" both had the story of the firm now being caught up in an insider trading investigation. both of them had it on the front page. kate kelly first reported the storiette yesterday and is here now with the very latest. >> you know, yesterday was a very rough day for steve cohen, the founder of sac capital. although his firm and its former employees have been surrounded in recent years by questions about whether or not there was improper trading at various times. the fact that the doj was
1:37 pm
involved with yesterday's case unveiled yesterday and not just the s.e.c. was news to him, i'm told. now the 56-year-old traders is being personally implicated in a situation that involved alleged misuse of invird information on a drug trial to sell short two pharmaceutical positions though it isn't clear what cohen knew before he authorized those trades back in december 2008. so far he's said he's confident his and his firm's behavior was appropriate and he is cooperating with investigators in this process. that said, the news of this doj proep probe was a bit of a shock from what i hear and the probe was the result of a trade engineered by a former sac employees named matthew martoma who has been arrested in his florida home yesterday and charged. cohen gen again was taken aback that federal investigators were involved. the hedge fund founder said he'll keep doing what he does. he's told staff members to just
1:38 pm
keep their heads down and continue trading as they always do. it is important to note that sac has had great returns in recent years. this year they're north of 10% up side. as a result investors have been very loyal to sac over the years and its capital base has grown. however one funds manager told me this morning that under pressure from some other investors of his own who are uncomfortable with the sac situation, he's been forced to redeem his firm's capital from sac. it is not a large amount and it is very unclear whether other investors will follow suit or not. but at the same time it kind of tells that you this recent set of events is touching a nerve among some investors, and perhaps some employees as well who seem a bit shaken. >> kate, stay with us. we'll bring in greg zuckerman with the "wall street journal." he's been tracking this story closely as well. greg, you've been following this. what are you hearing that's fresh or different? >> so what we've reported today was that mr.
1:39 pm
cohen who runs sac, there was a wiretap of his home back in 2008 and that's when this investigation really heated up. subsequently steven cohen was brought in and talked to the authorities and the question now is kind of where does it go from here and how much can it point to him personally. if you read the complaint, on one hand, yeah, he's really involved in this trade. on the other hand, there's no evidence there that he knew where this information came from. so that's still something they're working on. >> so it is unclear as to what he knew or what the providence of that information was that the government alleges was obtained corruptly from a doctor who was working on one of the panels. am i understanding correctly, greg? >> that's exactly right. you can make an argument and people in his camp make the argument -- people close to him, people that like him -- saying he's got so many traders and they all work on their own ideas and stuff comes up to him and he gets the best of the best ideas.
1:40 pm
he doesn't always understand or isn't always told the genesis of some of these ideas. others would say, hey, he's steven cohen, $8 billion out of $14 billion is his own money and he wants to know where this information comes from. >> greg, i think what you're getting at here is exactly the rub. everything i know of steve cohen suggests he will get in a trader's face and ask them to defend their position or promote their position depending on the situation. if he got an urgent e-mail from an employee on a sunday saying we need to talk, it's important, and then a few days later. cohen personally authorized a huge stock sale, you would think that he would really take that person to task about where their information was coming from and why they were doing a 180. at the same time i don't know if you would agree, but when i looked at that complaint, it wasn't clear to me whether the doj or the sec did have any record to
1:41 pm
recordings to draw from. they didn't even steve cohen by name. when i say that earlier in the year, i thought was it in place at the time this conversation occurred and how much more do they have up their sleeve, if anything. >> very good question. so what we reported was that they only had the wiretap for two weeks. it was back in 2008. it could have been after this trade. hypothetically they were looking for evidence post-trade, after the trade, to implicate him and they struck out hypothetically. >> could this be one of those cases -- either of you -- could this be one of those cases, which as in many federal prosecutions, the prosecutors go after the lower lying guy and then hope that that person will turn as part of a plea deal and squeeze the top guy? >> that's one clear scenario. it is an obvious scenario. you would wonder whether they've done that already though but you can definitely spin that and anticipate like that hypothetically. >> it also seems to me, tyler, like this case was sort of made by the presence of a cooperating
1:42 pm
witness in the form of this doctor, sidney gilman, who was part of an expert network studding, among other things, providing insight about these pharmaceutical companies as well as deeply involved with a drug trial that matthew martoma was following that didn't go well and ultimately provided the rationale behind his sale of the two drug companies. so that seems to have made the case against defendant martoma. whether or not they have somebody who could help make a case against cohen or other higher-ups is not clear. gilman was not part -- as far as i can tell, was not part of that conversation that allegedly occurred between cohen, the hedge fund owner and martoma. >> thanks very much. bertha coombs has a "market flash." >> watching shares of nokia. the mobilemaker is up today over 12% in a technical move, it spiked up nearly three times the
1:43 pm
daily volume. couple of good notes this morning, one out by cleveland research, a boutique firm, saying the lumia 920 seems to be selling better than anticipated. and also that the deal is trying to acquire a small mapping on a phone. >> one southern u.s. city is one of the hottest names in global real estate right now and cnbc wealth editor robert frank got a firsthand look at the swanky inventory. >> reporter: we are here in miami with foreigners pouring money into mansions like this one. that's coming up next. the national debt grew $112 million per month, on average, between june 2011 to june 2012.
1:44 pm
1:45 pm
1:46 pm
the official holiday shopping season begins this week. we asked you what your plan is. 9% said i'm spending more than last year. 33% said i'm spending about the same as last year. 51% said less than last year. 7% said i'm increasing my donations to charity. that's a good one. let's see what's coming up on "street signs" next hour, 2:00. coming up top of the hour, right as our show kicks off, the cease-fire in gaza begins. we'll take a look at the impact on oil prices. we'll also continue to dissect the finger pointing at hewlett-packard and you a tauto. the blame game is heating up. and stocks that have just waddled along. we'll run through all of those turkey stocks top of the hour. join us. back to you on "power lunch." the mansion market in miami is one of the hotspots in global real estate right now, but who's driving the sales? our wealth editor robert frank joins with us that part of the
1:47 pm
story. >> a lot of attention has been paid to buyers from latin america, but it is another group that's driving prices at the very top. that's the rich russians. i got an exclusive walk-through with the city's top mansion broker as she toured some monster homes. wealthy russians poured more than $12 billion into overseas real estate last year and much of that is washing up on the sandy shores of miami. a mansion in miami's indian creek area recently sold for $47 million. the most ever for a miami house. the buyer -- a russian. brokers say that russians are far and away the single largest group buying mega homes priced at $20 million or more. we went mansion shopping with one rich russian and with miami's super broker jill ebert. >> the master is beautiful. >> reporter: she's one of the jills, the team that sold that $47 million home. our first stop, a mediterranean
1:48 pm
style mansion with ten bedrooms, five basket rooms and two docks for your matching yachts. the pool is more like a man-made lagoon. it holds 100,000 gallons of water and one room is even designed by versace. price for all this luxury -- $37 million. next up -- a more modern mansion right on the beach. >> so isn't this staircase wild? >> reporter: or take the elevator. our buyer didn't close any deals that day but one wealthy russian may end up with miami's greatest real estate prize -- the versace mansion. 20,000 square foot chateau on the south beach strip is on the market for $125 million, which means that miami's new record may be broken soon. many of the brokers in miami are learning the russian language. they're also translating their websites into russian, and even forming partnerships with other
1:49 pm
brokers in moscow. living la vita russia in miami. >> it would be nice to have the jack to do business with the jills. wouldn't it? tyler, we've got some whales weighing in. groupon, for one stock. on november 12, george soros and paul tutor have taken stakes. trading at 3.78% on some very good volume. this story is the making of a perfect spoof on lady gaga's -- po-po-poker talks. poker talks. can't really sing very well. you didn't need me to tell you that, did you? a manhattan doctor finding a new market for botox. poker players.
1:50 pm
over the past five years, the national debt has grown at an average of $1.4 trillion per year. i always wait until the last minute. can i still ship a gift in time for christmas? yeah, sure you can. great. where's your gift? uh... whew. [ male announcer ] break from the holiday stress. ship fedex express by december 22nd for christmas delivery.
1:51 pm
1:52 pm
1:53 pm
power rundown time. joining is now, bob pisani and john carney. topic one, sac capital in the spotlight. what they say could be the most profitable insider trading case in u.s. history. a quarter of a billion dollars! but the is also trying to get a closer look into the notoriously private world of the founder of that hedge fund, steve cohen. bob pisani, your thoughts. >> the point here for the prosecution is they're after plp cohen. so far all they're saying is this beautiful manager, a, who we think is steve cohen certainly authorized trades based on what mr. martomo told him but we don't have any direct evidence that he knew it was based on insider information. i know it is strains credulity
1:54 pm
to realize he wouldn't have this kind of information but so far i haven't seen it surface. i think we have to wait for more information. >> i want to strain the credulity a little further because i've actually been talking to some people who used to work at sac capital. they said, look, if you got a piece of information you weren't supposed to have, you might put in the trade but you'd never reveal to anybody you had secret information. you just want the boss, stevie cohen, to think you were a geni genius. it is possible the guy had the information and that -- >> all right, topic two. you heard the bell. walmart bracing for possible black friday labor strike by perhaps thousands of its workers who are upset over health care, wages, schedules. how bad is it going to be? could it dramatically hurt holiday sales? >> i don't think it is going to dramatically hurt holiday sales. i think it is a good time for workers at walmart to make their point here saying we think we deserve to be treated better. i don't think we are going to have a mass walkout out of walmart. people will still be able to do
1:55 pm
their black friday shopping. >> the execution risk, is it going to matter at all -- >> how much can walmart's reputation be hurt. they've suffered through so much through the years, not necessarily justified -- >> i think john lass a good point. they should be a little bit concerned about what's going on. if that organizational effort picks up steam and there is a sense of injustice, if they can break through that sense that walmart isn't treating its employees so well, think there is reputational risk. i don't think there will be a big impant on sales. this whole thing about black friday is overrated. i think it is just pulling sales forward but extraction of percentage. >> i think some people will find it a relief to -- >> some want to escape home. >> that's right. do you need help with your poker face? botox could be a solution. this is topic three. manhattan doctor has found a new market to bet on, poker players and their neat for poker tox to
1:56 pm
play down their expressions. you like like a gambling man, mr. carney. >> this is like steroids. it is a performance enhancing drug. i think it should be banned from professional poker. but i do think maybe some of these hedge fund guys getting interviewed by the s.e.c. might want to look into it. >> i think this is a great story. number one, most poker players are male so maybe this is a great excuse for men to start getting botox. you can get botox now to conceal the fact that you're a lousy poker player! >> i got it not just i'm vain, i got it because i really needed to up my poker game. is that the excuse they're going to use? >> for non-new yorkers, there are so many secret, illegal, very high-stakes poker games that go on in new york city. more about all this after this break. we'll be right back on "power lunch." ♪ no he can't read my poker face ♪ inin and like something.. ♪
1:57 pm
[ car alarm deactivates ] ♪ ...or you can get out there with your family and actually like something. ♪ the lexus december to remember sales event is on, offering some of our best values of the year. this is the pursuit of perfection. ocustomer erin swensonest bought so, i'm happy. today. sales go up... i'm happy. it went out today... i'm happy. what if she's not home? (together) she won't be happy. use ups! she can get a text alert, reroute... even reschedule her package. it's ups my choice. are you happy? i'm happy. i'm happy. i'm happy. i'm happy. i'm happy. happy. happy. happy. happy. (together) happy. i love logistics.
1:58 pm
i've been a superintendent for 30 some years at many different park service units across the united states. the only time i've ever had a break is when i was on maternity leave. i have retired from doing this one thing that i loved. now, i'm going to be able to have the time to explore something different. it's like another chapter. why they have a raise your rate cd. tonight our guest, thomas sargent. nobel laureate in economics,
1:59 pm
and one of the most cited economists in the world. professor sargent, can you tell me what cd rates will be in two years? no. if he can't, no one can. that's why ally has a raise your rate cd. ally bank. your money needs an ally. this is an intraday chart of the dow. right near the highs of the session, up 54 points. you see about 1,230? we made a decided move higher is when we heard about the cease-fire between hamas and israel. of course, that

49 Views

info Stream Only

Uploaded by TV Archive on